Walmart Mexico and union agree on wage hikes, avert strike

FILE PHOTO: Two people walk outside a Wal-Mart store in Mexico City January 11, 2013. REUTERS/Edgard Garrido

MEXICO CITY (Reuters) - Walmart de Mexico, Mexico’s biggest retailer, has reached a deal with a union to raise worker salaries, both groups said on Thursday, heading off a possible strike and offering reassurance to businesses in the early months of a new government.

Walmart Mexico said in a statement it struck the agreement on Wednesday with the Revolutionary Confederation of Laborers and Farmworkers (CROC), offering its workers an average annual salary increase of 5.5 percent and an annual bonus tied to store performance.

CROC, which previously said it was seeking a 20-percent salary hike, confirmed the deal in a separate statement.

The dispute, despite involving only a few thousand of Walmart’s 234,000 employees in Mexico and Central America, has been closely followed by economists and business lobbies as a bellwether for how labor negotiations will fare under President Andres Manuel Lopez Obrador, who took office in December.

The leftist has vowed to fight poverty and deep-seated inequality across the country, and in January raised the daily minimum wage by 16 percent.

The same month, factory workers went on strike in the city of Matamoros near the U.S. border and teachers blocked railroad tracks in the western state of Michoacan to press home demands.

Those actions prompted a group representing some of Mexico’s biggest companies to urge Lopez Obrador to resist “extortion” by unions.